FINANCE

DSW net income rises in Q4; sees potential for 550 stores

BY Dan Berthiaume

Columbus, Ohio – DSW Inc. reported a net income increase in the fourth quarter of fiscal 2013 compared to the same period a year earlier, even as net sales dipped. Fourth quarter net income rose 4% to $28.1 million from $27.1 million, while net sales declined 4% to $572 million from $594 million and same-store sales remained flat.

In addition, DSW now sees a full build-out potential for 500 to 550 stores, including 35 new stores it expects to build in fiscal 2014. For the full year, the company expects revenue growth of 6% to 7%, with same-store sales growth in the low-single digit range.

During the full fiscal year 2013, DSW reported net income growth of 13.5%, to $172.8 million from $152.2 million. Reported sales increased 4.9% to $2.4 billion from $2.3 billion. Same-store sales increased 0.2%.

"We marked our fifth consecutive year of double digit earnings growth in 2013, with adjusted earnings per share of $1.88 compared to the prior year’s results of $1.67,” said Mike MacDonald, president and CEO of DSW Inc. “Effective inventory management and our new systems enabled us to expand full year merchandise margin to 45.1%, which is just 10 bps shy of our record margin in 2011. We were also able to improve on our SG&A rate by 80 bps to 20.4%, which led to our highest ever operating margin of 11.7%.”

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OPERATIONS

Wal-Mart to accept video game trade-ins

BY Dan Berthiaume

Bentonville, Ark. — Starting Wednesday, March 26, Wal-Mart customers will be able to trade in their video games and apply the value immediately toward the purchase of anything sold at Walmart and Sam’s Club, both in stores and online. The traded-in games will then be sent to be refurbished and made available for purchase in like-new condition at a reduced price.

The program will work as follows:

• Customers bring their working video games, in the original packaging, to the electronics department.

• Associates scan the UPC code on the case and evaluate the game for obvious damage such as deep scratches or cracks.

• The customer is then provided with a trade-in value for each game to accept.

• The total value accepted by the customer is awarded immediately and can be applied at checkout in a Wal-Mart store or Sam’s Club, or online at Walmart.com or SamsClub.com.

Available at more than 3,100 Wal-Mart stores nationwide, the new trade-in service will accept thousands of games for popular consoles like the Sony PlayStation3 and Microsoft Xbox 360. Trade-in value will vary.

“Gaming continues to be an important business for us and we’re actively taking aim at the $2 billion pre-owned video game opportunity,” said Duncan Mac Naughton, chief merchandising and marketing officer for Walmart U.S. “When we disrupt markets and compete, our customer wins. They’ll save money on video games and have the flexibility to spend it however they want.”

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News

GE taps new VP, manufacturing

BY CSA STAFF

GE has appointed Charles Nugent as VP, manufacturing, for GE Oil & Gas, reporting to Lorenzo Simonelli, SVP and CEO of GE Oil & Gas.

GE has 192 officers globally who lead large revenue-generating businesses or are in critical technology or functional roles, charged with helping to drive growth.

Nugent has been with the company for 30 years, holding a number of leadership roles in plant management and operations with GE Aviation. Most recently, he served as senior executive of product management at GE Aviation.

Nugent has a bachelor’s degree in electrical engineering from Michigan State University and a master’s degree in engineering from the University of Cincinnati.

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